NYK Inks Two Sustainability Linked Loans Worth US$804 Million
For Seafarers COVID Is Not Someone Else’s Problem: ITF Seafarers
April 1, 2021
Maritime Bodies Call For Including Seafarers In ‘Priority Workers’ List For Vaccinations
April 1, 2021
NYK signed two sustainability linked loan (SLL) agreements aligned with the Sustainability Linked Loan Principles set forth by the Loan Market Association* and other organizations. These two agreements bring NYK’s total number of SLLs to four.
The objective of the SLL is to promote and support environmentally and socially beneficial economic activities by linking corporate loan terms with a customer’s performance against mutually agreed sustainability performance targets (SPTs) consistent with a customer’s ESG strategy.
The SPTs in both agreements are to maintain a high CDP** climate change disclosure score. As long as high CDP ratings are achieved, the interest rate terms will remain unchanged until the repayment deadline.
Representation Image – Credit: nyk.com
On February 3, NYK announced the NYK Group ESG Story, which aims to further integrate ESG into the company’s management strategy, and this is the first ESG finance project since that announcement. To strongly promote ESG management, NYK will promote new value creation as a sustainable solution provider through a business strategy that responds to climate change.
Overview of first loan
| Execution date of agreement | March 31, 2021 |
| Agent | MUFG Bank Ltd. |
| Contract period | 5 years |
| Total amount | USD 204 million |
| Use of proceeds | Business fund |
| Type | Term loan |
| Participating financial institutions | The Iyo Bank Ltd. |
| The Bank of Saga Ltd. | |
| The Shikoku Bank Ltd. | |
| The Nomura Trust and Banking Co. Ltd. | |
| The Hachijuni Bank Ltd. | |
| MUFG Bank Ltd. |
Overview of second loan
| Execution date of agreement | March 31, 2021 |
| Lender | Sumitomo Mitsui Banking Corporation |
| Total amount | USD 600 million |
| Use of proceeds | Business fund |
| Type | Revolving credit facility (Commitment line) |
This loan has obtained third-party opinions from Japan Credit Rating Agency Ltd. (JCR) for the loan’s rationality and compliance with the Sustainability Linked Loan Principles published by the Loan Market Association (LMA).
* An association dedicated to improving the liquidity, efficiency, and transparency in the primary and secondary syndicated loan markets in Europe, the Middle East, and Africa. Based in the UK, this association has about 760 member institutions in over 69 countries, mainly in Europe and the Middle East.
** An international non-profit organization working with companies, investors, cities, states, and regions to prevent dangerous climate change, ensure water security, and avoid deforestation. To manage risks that climate change poses to companies, CDP uses questionnaires to collect information on carbon dioxide emissions and climate change initiatives of major companies around the world and analyzes and evaluates the data collected.
Reference: nyk.com
Source: Maritime Shipping News